As the new year arrived, several American-manufactured electric vehicles (EVs) found themselves ineligible for tax credits based on the US Department of the Treasury’s new rules on battery sourcing. The rules came into effect on January 1st.
The new rules were issued in December and pertain to battery sourcing requirements meant to decrease the US EV sector’s dependence on Chinese imports. As a result of the implementation, the number of eligible EV models has dropped from 43 as of the end of 2023, to just nineteen.
Among those stripped of up to $7,500 in tax credits are the Chevrolet Blazer EV, the Nissan Leaf, as well as several Tesla Model 3s and the new Tesla Cybertruck All-Wheel Drive.
The Treasury has released a statement saying that this could still change as they await additional model information from several manufacturers. Department officials also said that several automotive firms are working to ensure that their supply chains are IRA-compliant, enabling buyers to stay eligible for clean vehicle credits.
It is hoped that, through changes caused by the new regulations, American EV manufacturers and their allies can bring investments into the country, generate employment, and improve the national economy.
What are EV Firms Doing About It?
While BMW’s US unit has made no comments regarding its next course of action, other automotive companies are working to ensure that more of their EV models will qualify for tax credits.
General Motors, in particular, is aware that the bulk of its EV models are eligible under the new rules, save for the Chevrolet Bolt. However, it expects that models like the Lyriq and Blazer EV among others will become eligible again once it makes adjustments to its sourcing.
Tesla, on the other hand, disclosed last month that only its Model 3 Performance has retained credit eligibility following the January 1 implementation. The same goes for Ford’s F-150 Lighting and its Lincoln Corsair Grand Touring EV.